The attached Purchasing Audit Work Program includes two distinct samples for conducting an audit of purchasing processes within an organization. Both samples are structured to facilitate a thorough and systematic evaluation of the purchasing process, with a focus on internal control mechanisms, segregation of duties, efficiency of the process and areas for improvement.

Sample 1 primarily emphasizes on the planning phase, where the nature and scope of the audit are discussed with key personnel. It also outlines the steps involved in understanding the purchasing process, including conducting interviews, creating process maps, and evaluating current practices against best practices. Detailed audit procedures are also provided, which involve testing selected purchasing transactions for operational effectiveness and consistency of key controls. Sample 2 focuses more on reviewing compliance with established procedures for the purchasing function. It covers areas like the requisitioning process, consistent pricing, identifying and obtaining key vendors, proper authorization, adequacy of supporting documentation, timeliness of receiving process, and segregation of duties. It also provides guidelines for understanding and reviewing various processes like purchase requisition, purchase order, receiving/inspection process, and contract negotiation. The document concludes with a section on reporting, which includes preparing a preliminary draft of the audit report and issuing the draft to management for comments.

Audit steps include:

• Discuss the nature and scope of the audit with key personnel
• Review compliance with established procedures for the purchasing function
• Perform detailed testing on selected purchasing transactions
• Understand and review the purchase requisition (PR) and purchase order (PO) processes